For the umpteenth time in his 16-year tenure at the top, Cisco CEO John Chambers will host the company’s annual investor’s day conference today.Insiders wonder if it will be his last time.
“The internal people at Cisco are having a massive war right now about potential succession,” a source close to the company tells the Globe and Mail.
“There is real tension about succession. Everybody knows it’s coming now.”
Chambers had a great run at Cisco during his first five years – as both profits and revenues exploded amid the worldwide Internet revolution.
But since the nadir of the dotcom bust, Cisco stock has been essentially flat. Revenues are up big since then, but that’s not impressive considering all of Cisco’s tack-it-on acquisitions. Earnings per share are up some over the past 10 years – but even growth there has slowed a lot since 2006.
Chambers tried moving Cisco into the consumer market – where it has no expertise – and that effort flopped. Remember Flip – acquired for hundreds of millions only to be shut down 25 months later?
At one point, Chambers even imposed a strange, meeting-heavy org structure on Cisco’s hundreds of managers. After an alarmist article in the WSJ, he finally scrapped it.
Chambers, it seems, is out of ideas. Insiders know it, and they’re fighting with each to take his job.
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